How will EU react to new Tehran oil bourse?

[enid602]

Has anyone heard or read how the European states might react to the new oil bourse? It is scheduled to go online on March 1, and would seem to have the potential of destabilizing the dollar's role as the international currency of exchange. Any disruption to the dollar will affect every country, so I'm not sure it's in the best interest of Europeans to go along with the Iranian scheme. Have Europeans spoken up either for or against the bourse?

[Vincardog]

1. They will love it. They will be able to punish the NeoConvicts for their

wastefully ways and end their FASCIST plans for World Domination. When oil is $200/bbl but they can pay $32euros/bbl they will be happy

[MercutioATC]

2. Not to mention, it'll be great for the Euro.

This has been coming for a long time...it'll be interesting to see what happens.

[enid602]

3. European reaction

But a sudden downward trend in the dollar's strength has a lot of global implications. Europe's exports will become more expensive, even though they don't export a lot to the US. Third world countries' currency reserves (generally denominated in dollars, so they can purchase petro and meet dollar-denominated IMF obligations) will lose value overnight, as will huge investments held by Chinese, Japanese, Europeans, etc. A drastic change in the dollar promises to wreak havoc, even if it provides some limited benefits to the Europeans. I can see why it might be beneficial to all to have an international unit of exchange separate from the dollar (or any other currency), but it would be far less destructive to decide on a new currency before allowing the old one to be destroyed.

With all the hubbub surrounding European leaders' criticisms of Iran's nuclear program, I find it unusual that they have not been speaking with re: to the oil bourse, which has a more immediate importance. Ironically, European leadership appears to be in sync with Bushco, who saber rattle with re: to nuclear power, but are surprising silent with re: to the bourse story. Just seems odd to me.

[MercutioATC]

4. Oh, it'll be cataclysmic, no doubt, but the Euro will come out on top.

...and the dollar will lose what some estimate to be 20-30% of its value that is currently based on its status as the world's petroluem currency.

[this_side_up]

5. I read it begins March 20 n/t

[doublethink]

6. My take so far .....

When Iran moved it's holdings out of European Banks a couple of weeks ago (to prevent them from being frozen by any upcoming sanctions) I speculated that Iran might have to put off it's Bourse, scheduled to go online March 20th. But the Europeans haven't made any move, or shown any hint of not buying Iranian oil (as a sanction) and therefore it seems that the Bourse can go ahead as planned and probably not become any part of sanctions imposed by the West, no matter what the Bush Regime wants. The Iranian Oil Boise can only help European economies (in the long run) in trading in Euros, and the Europeans cannot afford to cut off their shipment of oil from Iran anyway. The U.S. receives 0 barrels of Oil from Iran, so unless the U.S. somehow supply's Europe with any shortage of Oil they would get from sanctioning Iranian Oil, or war .... well anyway, it still looks like around March 20th for the shit to hit the fan? Another curious event I was paying attention to was when Putin of Russia through the Ukraine recently had the power to shut off like 70% of the natural Gas supplies to Western Europe for a few days. Looked like an ominous warning shot to the EU .... of the possibility's of making the wrong decisions regarding Iran. We shall see. Peace.

note: any cutoff of Iranian Oil shipments anywhere in the world (or the closing down of the Straight of Hormuz for that matter) would be catastrophic to everyones everyday life, to say the least.

[enid602]

7. Iran

Even if the Europeans (no doubt under pressure from the US) do boycott Iranian oil in the upcoming months, the slack will readily be picked up by the Chinese and the Indians. Asians would love this source of petroleum, but paying in Euros (and driving down the dollar) is not in their immediate best interest, given their level of US treasury bond investments.

This situation really is complex. Whatever happened to the old days of economic summits where responsible leaders met to discuss issues that affected them all, and resolve thorny issues by consensus. I guess that's just not Georgie's style; instead, he's whipping up trumped up charges against Iran, bringing us closer to WWW III.

[doublethink]

8. From this article ...... (concerning the Iranian Bourse)

"Europeans will not have to buy and hold dollars in order to secure their payment for oil, but would instead pay with their own currencies. The adoption of the euro for oil transactions will provide the European currency with a reserve status that will benefit the European at the expense of the Americans ... The Chinese and the Japanese will be especially eager to adopt the new exchange, because it will allow them to drastically lower their enormous dollar reserves and diversify with Euros, thus protecting themselves against the depreciation of the dollar" -snip-

http://www.iranian.ws/iran_news/publish/article_12760.shtml

Kind of a quick synopsis, and the Chinese have been diversifying their currency reserves away from the U.S. dollar the last few months big time. Even so I agree they still have a big investment in the U.S.A ..... and the exports they send us ..... they wouldn't want to see their 'investment' go south too fast here .... but like you say it is a changing world, other markets and such eager to take dominance. And we have dip-shits in Washington with an itchy trigger finger willing to start WW3 again like you say over this. What-cha-gonna-do? ...... sigh.

[enid602]

9. thank you

That's a good article.